When it issued the new rules, FinCEN said covered financial institutions are currently not required to know the identity of individuals who own or control their legal entity customers. The new rule will correct that, FinCEN said.

"This enables criminals, kleptocrats and others looking to hide ill-gotten proceeds to access the financial system anonymously," FinCEN said when outlining reasons for the rules. "The beneficial ownership requirement will address this weakness and provide information that will assist law enforcement in financial investigations, help prevent evasion of targeted financial sanctions, improve the ability of financial institutions to assess risk, facilitate tax compliance, and advance U.S. compliance with international standards and commitments."

The rules will require credit unions to obtain and verify the identity of all beneficial owners at the time an account is opened. Credit unions may use a standard certification form that is contained in the rules or any other means that complies with the rules. Credit unions will be required to maintain records and may rely on another financial institution's verification.

Under the plan, money laundering requirements will be amended to include risk-based procedures for conducting ongoing customer due diligence in an effort to develop a customer risk profile.

"A customer risk profile refers to the information gathered about a customer at account opening used to develop a baseline against which customer activity is assessed for suspicious activity reporting," FinCEN said.

Credit unions will also be required to monitor possible signs of risk, such as cross-border wire transfers that take place for no apparent reason or a significant change in member activity.

FinCEN said several proposed rule commenters asked that smaller financial institutions be exempt from the requirement since they pose fewer risks than larger institutions and the new ownership would be burdensome.

FinCEN declined this request, stating, "Indeed, a blanket size-based exclusion would provide a clear roadmap for illicit actors seeking an easy entry point into the financial system."

In response to the rules, CUNA also said while it supports efforts to track money laundering and terrorist financing, the cost of implementing the rules will outweigh the benefits. The trade association added FinCEN said in its regulatory impact assessment that while it is unable to quantify all of the costs and benefits of the rules, the regulations will benefit society as a whole. 

"This is a flawed approach to a cost-benefit comparison, since the costs of these requirements are essentially taxes on financial institutions," CUNA said. "Since credit unions are already paying for compliance costs related to prudential and consumer protection regulations, additional costs from this third regulatory regime are particularly burdensome."